Charlie Munger's 15 Maxims, lifelong wisdom from Poor Charlie's Almanack, worthy of deep reflection by every brother. For example: Making big money doesn't rely on trading, it relies on waiting; there are three ways to go bankrupt: alcoholism, lust, and gambling; if you cannot accept a 50% drawdown, you are destined to only accept mediocre returns; becoming rich is like rolling a snowball, standing on a very long snowy path and continuously rolling for a long time. However, the most valuable aspect of Munger's investment philosophy is: patience, focus, and circle of competence.
The circle of competence principle is an important concept first proposed by Warren Buffett, emphasizing making decisions within areas you are familiar with and skilled in. This principle applies not only to investments but also broadly to the workplace, entrepreneurship, learning, and other areas. You must be clear about what you know and what you don't know. Play those games where you have an advantage; don't touch the others; concentrate your investments within your circle of competence; and then follow long-termism: compound interest is the eighth wonder of the world. Those who understand it earn it, those who don't pay it.
